Increased Digitalization and Automation to Drive Variable Frequency Drive (VFD) Market Growth
The rising trend towards digitalization, connectivity, and automation of industrial processes across many industry verticals has resulted in a growth in demand for VFDs, which allow them to remotely monitor the process. In complex industrial applications, such as large building HVAC systems, the resulting data can be optimised with a significant increase in efficiency and energy savings by controlling and monitoring the motor with variable drives, changing them into smart motors and even facilitating them to be controlled remotely or even automatically, further optimising performance, system efficiency, and energy savings.
However, various industry participants are also conducting R&D operations to incorporate cutting-edge technology such as the Industrial Internet of Things (IIoT) into these devices. Adding this feature may significantly minimise system downtime, energy usage, wear and tear, as well as efficient machine optimisation and predictive maintenance. For example, in April 2020, ABB incorporated a seamless safety functioning and connectivity for its all applicable variable speed drives in machine manufacturing and automation, as well as simplified the process of engineering design in machine manufacturing and automation.
However, various industry participants are also conducting R&D operations to incorporate cutting-edge technology such as the Industrial Internet of Things (IIoT) into these devices. Adding this feature may significantly minimise system downtime, energy usage, wear and tear, as well as efficient machine optimisation and predictive maintenance. For example, in April 2020, ABB incorporated a seamless safety functioning and connectivity for its all applicable variable speed drives in machine manufacturing and automation, as well as simplified the process of engineering design in machine manufacturing and automation.
Rapid Industrialization & Rising Adoption of Variable Frequency Drives (VFDS) Across Major Vertical Industries will Drive Market
The increase of automation in the industrial sector has fuelled market expansion. According to the latest World Robotics research, 553,025 new industrial robots installed in companies globally in 2023, an all-time high. The emphasis on smart manufacturing practises is an important market trend. As per the India Brand Equity Foundation (IBEF), the Government of India has set an ambitious objective of expanding manufacturing output contribution to GDP to 25% by 2025 from 16%. The Udyog Bharat 4.0 Smart Advanced Manufacturing and Rapid Transformation Hub (SAMARTH) programme intends to raise awareness of Industry 4.0 in the Indian manufacturing industry and allow stakeholders to overcome automated material handling concerns.
Furthermore, the manufacturing industry is going towards automation as a result of the globally influence of Industry 4.0, the internet of things, and smart manufacturing practises. VFDs are an excellent fit for this emerging trend. For instance, to provide a variety of drive options, Danfoss collaborated with the Chennai Metro Rail (CMRL) and Kolkata Metro Rail Corporation (KMRC). VFDs are being used in a variety of innovative applications. VFDs are used in applications with grid connections, such as frequency converters and pump storage. VFDs are also expected to be used in new industries such as capturing carbon, hydrogen generation, and transportation.
Furthermore, the manufacturing industry is going towards automation as a result of the globally influence of Industry 4.0, the internet of things, and smart manufacturing practises. VFDs are an excellent fit for this emerging trend. For instance, to provide a variety of drive options, Danfoss collaborated with the Chennai Metro Rail (CMRL) and Kolkata Metro Rail Corporation (KMRC). VFDs are being used in a variety of innovative applications. VFDs are used in applications with grid connections, such as frequency converters and pump storage. VFDs are also expected to be used in new industries such as capturing carbon, hydrogen generation, and transportation.
Recent Trends in Variable Frequency Drive (VFD) Market:
- VFDs are increasingly integrated with IoT for real-time monitoring and predictive maintenance.
- Enhanced energy-saving features in VFDs focus on reducing power consumption and operational costs.
- New VFD models utilize AI and advanced algorithms for improved performance and optimization.
- Modern VFDs feature advanced interfaces like touchscreens and remote access for easier operation.
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High VFD System Installation Cost to Limit Adoption
VFDs offer several energy-saving benefits, but the cost of installing VFD devices may limit market expansion. The use of these drives in any industry or application improves process efficiency; however, during the upgrade and expansion of any project, the power requirement is frequently changed, which may result in the drive being used as per the customer's needs for the distribution system, which raises the total cost of installation. Furthermore, VFDs for applications such as HVAC have lower power factors, harmonics, and operating noise, which may damage the system's distribution capacity, resulting in a rise in overhead costs.
Furthermore, incorporating variable frequency drives (VFDs) into current systems may pose notable difficulties, mainly because of the intricate process of adjusting these drives to diverse industrial configurations. This level of integration frequently demands high-level technical skills and know-how, as VFDs need to be coordinated with current control systems, motors, and infrastructure. Adjustments, reprogramming, and testing are often required in the process to guarantee compatibility and achieve optimal performance. Throughout this time frame, businesses could encounter prolonged periods of inactivity while the system is restructured and tested, which could impact production schedules and operational efficiency. Moreover, industries shifting to VFD technology may encounter significant challenges such as increased expenses, prolonged implementation timelines, as well as the requirement for specific skills and potential workflow disruptions, acting as major obstacles.
Furthermore, incorporating variable frequency drives (VFDs) into current systems may pose notable difficulties, mainly because of the intricate process of adjusting these drives to diverse industrial configurations. This level of integration frequently demands high-level technical skills and know-how, as VFDs need to be coordinated with current control systems, motors, and infrastructure. Adjustments, reprogramming, and testing are often required in the process to guarantee compatibility and achieve optimal performance. Throughout this time frame, businesses could encounter prolonged periods of inactivity while the system is restructured and tested, which could impact production schedules and operational efficiency. Moreover, industries shifting to VFD technology may encounter significant challenges such as increased expenses, prolonged implementation timelines, as well as the requirement for specific skills and potential workflow disruptions, acting as major obstacles.
New Product Development by Key Players Led to Market Growth
Variable frequency drives (VFDs) are essential in enhancing motor performance by modifying speed and torque based on operational requirements. This feature improves energy efficiency, lowers operational expenses, and prolongs the lifespan of equipment. VFDs play a crucial role in industries by providing accurate process control, reducing energy inefficiencies, and decreasing greenhouse gas emissions. Their indispensability in modern automation and energy management is driven by their capability to enhance system reliability and adjust to different load conditions, ultimately promoting operational excellence and sustainability. For instance, in April 2023 ABB stated that it will accelerate its expansion plan in the United States by investing around US$ 170 million and generating highly skilled jobs in manufacturing, innovation, and distribution operations. The opening of the drives and services manufacturing plant will boost industrial electric drive production capacity in the United States and provide more customer services. In the US market, the company provides a comprehensive range of AC variable frequency drives and controllers that minimise energy usage in buildings and industrial applications. In addition, in October 2023, Invertek Drives Ltd, a leading innovator and manufacturer of electric motor control technology, has unveiled a new product poised to redefine elevator motor control. The company introduced its new variable frequency drive (VFD), Optidrive Elevator Core, at Interlift 2023, one of the world's premier elevator industry events.
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Asia-Pacific is Anticipated to Be the Fastest-Growing Market During the Forecast Period
The variable frequency drives market in China is expected to grow rapidly due to expanded operations, particularly in the oil and gas industries and power generation as well as major investments in manufacturing facilities. China's emphasis on infrastructure growth has resulted in FDI in a variety of manufacturing and industrial industries. The Chinese government's active support has empowered a higher number of value-added industries, resulting in overall industry growth, with several Chinese industrial sectors, such as solar and wind energy, automotive, petrochemical processing, telecommunications, and steel production, placing among the top contributors to the country's economic progress. As a result, these industries have the greatest influence on the demand for variable frequency drives. As a result, China remains the most profitable VFD market.
With rising energy prices, the Indian VFD sector is entering a development phase, requiring the use of energy-efficient motor control systems and drives. End-user awareness of the benefits of excess drives, including as greater process control performance, reduced maintenance requirements, and longer motor and equipment life, encourages VFD adoption. Over the past few years, regulatory bodies in Asia-Pacific countries have been continuously enforcing energy consumption regulations. This should provide strong development potential for the variable frequency drives market over the next 5-7 years.
With rising energy prices, the Indian VFD sector is entering a development phase, requiring the use of energy-efficient motor control systems and drives. End-user awareness of the benefits of excess drives, including as greater process control performance, reduced maintenance requirements, and longer motor and equipment life, encourages VFD adoption. Over the past few years, regulatory bodies in Asia-Pacific countries have been continuously enforcing energy consumption regulations. This should provide strong development potential for the variable frequency drives market over the next 5-7 years.
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The report provides a detailed overview of the variable frequency drive (VFD) market insights in regions including North America, Latin America, Europe, Asia-Pacific, Oceania, and the Middle East and Africa. The country-specific assessment for variable frequency drive (VFD) market has been offered for all regional market share, along with forecasts, market scope estimates, price point assessment, and impact analysis of prominent countries and regions. Throughout this market research report, Y-o-Y growth and CAGR estimates are also incorporated for every country and region, to provide a detailed view of the variable frequency drive (VFD) market. These Y-o-Y projections on regional and country-level markets brighten the political, economic and business environment outlook, which are anticipated to have a substantial impact on the growth of the variable frequency drive (VFD) market. Some key country and region included in the variable frequency drive (VFD) market report as follows:
| Regions | Countries |
|---|---|
| North America | United States, Canada |
| Latin America | Brazil, Mexico, Argentina, Colombia, Chile, Rest of Latin America |
| Europe | Germany, United Kingdom, France, Italy, Spain, Russia, Netherlands, Switzerland, Poland, Belgium, Sweden, Austria, Norway, Denmark, Finland, Rest of Europe |
| Asia Pacific | China, India, Japan, South Korea, Australia & New Zealand, Indonesia, Malaysia, Singapore, Thailand, Vietnam, Philippines, Rest of Asia Pacific |
| Middle East and Africa | GCC Countries, South Africa, Nigeria, Egypt, Turkey, Morocco, Ethiopia, Algeria, Israel, Iran, Kenya, Rest of MEA |
Variable Frequency Drive (VFD) Market Research Report Covers In-depth Analysis on:
- Variable frequency drive (VFD) market detailed segments and segment-wise market breakdown
- Variable frequency drive (VFD) market dynamics (Recent industry trends, drivers, restraints, growth potential, opportunities in variable frequency drive (VFD) industry)
- Current, historical and forthcoming 10 years market valuation in terms of variable frequency drive (VFD) market size (US$ Mn), volume (Units), share (%), Y-o-Y growth rate, CAGR (%) analysis
- Variable frequency drive (VFD) market demand analysis
- Variable frequency drive (VFD) market pricing analysis over forecast period (by key segment and by region)
- Variable frequency drive (VFD) market regional insights with region-wise market breakdown
- Competitive analysis – key companies profiling including their market share, product offerings, and competitive strategies.
- Latest developments and innovations in variable frequency drive (VFD) market
- Regulatory landscape by key regions and key countries
- Supply chain and value chain analysis in variable frequency drive (VFD) market
- Variable frequency drive (VFD) market sales and distribution strategies
- A comprehensive overview of parent market
- A detailed viewpoint on variable frequency drive (VFD) market forecast by countries
- Mergers and acquisitions in variable frequency drive (VFD) market
- Essential information to enhance market position
- Robust research methodology
- Frequently Asked Questions -
What are the key factors driving the growth of the VFD market?
The primary drivers include increasing energy efficiency needs, advancements in automation technology and growing industrial applications that require precise motor control.
What are the major challenges faced in the VFD market?
Challenges include high initial costs, complexity in integration, and the need for regular maintenance and technical support.
How is the adoption of VFDs expected to change in the next decade?
Adoption is likely to rise as industries continue to seek energy savings and enhanced control capabilities, driven by technological advancements and regulatory pressures for energy efficiency.
